SIIC Environment to divest stake in waste treatment unit for S$59m

MAINBOARD-LISTED SIIC Environment announced on Wednesday (Jul 6) that it will divest all its equity interest in waste treatment and incineration subsidiary Hongkong Navy New Energy (Dazhou) for RMB283.3 million (S$59.1 million)

In its bourse filing, the wastewater treatment company said that the purchaser, Sichuan SIIC Ecological Company, is not an “interested person” and that the consideration was determined after arm’s-length negotiations between both parties.

It added that the announced book value and net tangible asset value of the subsidiary stood at RMB282.2 million and RMB277.1 million respectively, according to an asset valuation report issued by Wan Long (Shanghai) Asset Appraisal.

The subsidiary’s net asset value stood at 2.0 per cent that of SIIC Environment; it contributed 1.1 per cent of the group’s net profits as at Mar 31, 2022.

Pro forma, the group’s net tangible assets per share based on the latest audited financial statements of the group as at Dec 31, 2021 would have risen from RMB5.2672 to RMB5.2677 after the disposal. Pro forma earnings per share would also have risen from 27.35 to 27.40 after the disposal.

SIIC Environment said that the divestment would recover shareholder investment and generate profits for the group. The net proceeds of the deal would be used to finance general corporate and working capital requirements of the group.

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SIIC Environment shares closed flat at S$0.215 on Wednesday before the announcement.